Post Session: Quick Review

Indian equity benchmarks finished Monday's trading session lower with around half a percent cut, ahead of the upcoming RBI monetary policy. Indices made a gap-down opening, as traders were cautious after U.S. President Donald Trump levied tariffs on Canada, Mexico and China over the weekend. In afternoon session, markets came off from day’s low point, but remained in red till end of the session. 

Some of the important factors in today’s trade:

U.S. President tariff fears: Traders were cautious after U.S. President Donald Trump levied tariffs on Canada, Mexico and China over the weekend. On Saturday, Trump signed an order implementing a 25% tariff on imports from Mexico and Canada, and a 10% tariff on goods from China.

Some cautiousness prevailed amid foreign fund outflow: Foreign institutional investors (FIIs) offloaded equities worth Rs 1,327.09 crore in the capital markets on a net basis on Saturday. 

India's manufacturing PMI surges to 57.7 in January: Traders overlooked report that HSBC India Manufacturing Purchasing Managers’ Index (PMI) surged to 57.7 in January as against 56.4 in December. January data also showed a pick-up in growth of buying levels and record job creation. 

Except USD, rupee stable against all other currencies: Finance Minister Nirmala Sitharaman has rejected criticism over the slide of the Indian rupee, saying it has depreciated only against a strengthening US dollar but remained stable against all other currencies because of the strong macroeconomic fundamentals.

Global front: European markets were trading lower, after U.S. President Donald Trump imposed trade tariffs on several countries and threatened to do the same with the European Union and U.K. Asian markets ended in red, amid the manufacturing sector in Japan continued to contract in January, and at a faster pace, the latest survey from Jibun Bank revealed with a PMI score of 48.7. That's down from 49.6 in December, and it moves further beneath the boom-or-bust line of 50 that separates expansion from contraction.

The BSE Sensex ended at 77186.74, down by 319.22 points or 0.41% after trading in a range of 76756.09 and 77260.37. There were 11 stocks advancing against 19 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.89%, while Small cap index down by 1.77%. (Provisional)

The few gaining sectoral indices on the BSE were Consumer Durables up by 0.74%, TECK up by 0.57%, IT up by 0.39% and Healthcare up by 0.12%, while Capital Goods down by 4.29%, Industrials down by 3.79%, Power down by 3.30%, PSU down by 2.80% and Utilities down by 2.71% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bajaj Finance up by 5.03%, Mahindra & Mahindra up by 2.78%, Bajaj Finserv up by 2.27%, Bharti Airtel up by 1.70% and Maruti Suzuki up by 1.50%. On the flip side, Larsen & Toubro down by 4.65%, Tata Motors down by 2.58%, Hindustan Unilever down by 2.55%, Asian Paints down by 2.33% and ITC down by 1.89% were the top losers. (Provisional)

Meanwhile, Global Trade Research Initiative (GTRI) said the customs duty reduction announced in the Budget on products such as motorcycles and synthetic flavouring essences would benefit American exports. It said that despite the repeated criticism of India as the biggest tariff abuser and tariff king by the Trump-administration, the country's Budget has introduced significant tariff reductions on multiple products, many of which benefit the US exports. 

GTRI said with key tariff cuts on technology, automobiles, industrial inputs, and waste imports, India appears to be taking steps toward facilitating trade even as the global trade environment remains tense. It said whether these reductions will alter Washington's view of India's trade practices or become a point of contention in the US election cycle remains to be seen. Among the key tariff reductions, India lowered the duty on fish hydrolysate for the manufacturing of aquatic feed from 15 per cent to 5 per cent, a move that directly impacts US exports, which amounted to $35 million in 2023-24. 

The CNX Nifty ended at 23361.05, down by 121.10 points or 0.52% after trading in a range of 23222.00 and 23381.60. There were 16 stocks advancing against 35 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bajaj Finance up by 5.32%, Mahindra & Mahindra up by 3.14%, Wipro up by 2.89%, Shriram Finance up by 2.70% and Bajaj Finserv up by 2.33%. On the flip side, Larsen & Toubro down by 4.59%, ONGC down by 3.32%, Tata Consumer Products down by 3.14%, Coal India down by 2.93% and Bharat Electronics down by 2.71% were the top losers. (Provisional)

Asian markets settled down on Monday tracking Wall Street’s fall on Friday last week on fears of a global trade war as US President Donald Trump imposed tariffs of 25% on Canadian and Mexican imports and an additional 10% tax on Chinese goods, and also threatened possible tariffs against the United Kingdom and the European Union. Hong Kong shares ended flat as China’s weak manufacturing data underlined the need for more government support measures to support the Chinese economy, while Chinese market remained closed for the Lunar New Year holiday.